US STOCKS-Techs sink as Google, Microsoft disappoint, Dow up

* Nasdaq down 1.3 pct, Dow up 0.4 pct, S&P up 0.03 pct

* Google, Microsoft slide after earnings disappoint

* Citigroup shares soar on smaller-than-expected loss

(Updates to close)

By Kristina Cooke

NEW YORK, July 18 (Reuters) - Technology stocks fell on Friday and drove the Nasdaq down 1 percent on disappointing earnings from Google (GOOG.O: Quote, Profile, Research, Stock Buzz) and Microsoft(MSFT.O: Quote, Profile, Research, Stock Buzz), while Citigroup's smaller-than-expected loss pushed up the Dow and helped keep the broader market near the unchanged mark.

Nevertheless, the S&P 500 and Nasdaq snapped a six-week losing streak. The Dow snapped four weeks of losses as financial stocks rallied after the U.S. government outlined a plan to shore up mortgage finance companies Fannie Mae (FNM.N: Quote, Profile, Research, Stock Buzz) and Freddie Mac (FRE.N: Quote, Profile, Research, Stock Buzz) and the SEC announced rules to curb short selling.

Reassuring quarterly results from key banks also fed the week's rally, with Citigroup capping a series of closely watched scorecards from Wells Fargo (WFC.N: Quote, Profile, Research, Stock Buzz) and JPMorgan Chase & Co (JPM.N: Quote, Profile, Research, Stock Buzz) that beat analysts' estimates.

On top of that, the biggest weekly drop ever in oil prices also gave investors a renewed appetite for equities.

Despite their weekly gain, tech stocks ended the week with a thud. Google's stock fell almost 10 percent, its biggest one-day percentage drop since it went public in 2004, and Microsoft shares slid 6 percent, a day after the tech bellwethers' quarterly results fell short of expectations.

"The government's plan to provide funding for Fannie and Freddie and the SEC's short-selling rule put a floor, for now, under financials. But you'll start to see investors increasingly differentiate between 'the haves and have nots' in financials," said Michael Sheldon, chief market strategist at RDM Financial, in Westport, Connecticut.

The Dow Jones industrial average .DJI rose 49.91 points, or 0.44 percent, to 11,496.57. The Standard & Poor's 500 Index .SPX was little changed, up just 0.36 of a point, or 0.03 percent, at 1,260.68.

The Nasdaq Composite Index .IXIC, meanwhile, shed 29.52 points, or 1.28 percent, to close at 2,282.78.

For the week, the Dow rose 3.5 percent, its best week in three months. The S&P 500 rose 1.7 percent, while the Nasdaq was up 1.9 percent.

Citi's results were a sharp contrast to a larger-than-expected quarterly loss from Merrill Lynch (MER.N: Quote, Profile, Research, Stock Buzz). For most of the session, Merrill's stock was lower, but it eked out a gain in the last hour of trading. Merrill ended up 0.6 percent at $30.91.

Regional banks, many of which report earnings next week, were among the top sector drags on the S&P 500, suggesting investor worry that the credit crisis has not run its course for some of the less diversified, smaller banks. The S&P Regional Banks Index .GSPBNKS fell 0.8 percent.  Continued...